HANO AGENDA, JUNE 2010

President's message:

State cap on itemized deductions
could impact charitable donations

The State Legislature passed House Bill 1907 in the 11th hour, just before it adjourned, and the measure now sits on Governor Lingle's desk, awaiting her signature. It would temporarily cap itemized deductions on state income tax returns until Jan. 1, 2016.  

Itemized deductions could not exceed $50,000 for taxpayers filing jointly with income over $300,000, or $25,000 for individuals with income over $150,000.  The measure is expected to raise about $33 million toward balancing the budget. Lingle aides say she is concerned as even home mortgage interest might not be deductible if they exceed the new threshold. She has until early July to decide whether she will veto.

HANO wrote to Governor Lingle expressing concerns that this cap diminishes charitable giving incentives. The National Council of Nonprofits, our national office, is looking in on this development, as Hawaii’s innovative ways to balance the state budget is once in national headlines.  Business Week was also paying attention. 

Meanwhile, the Honolulu City Council Budget Committee passed Bill 32 (2009), CD 1, on third reading and the measure could become law effective July 1, raising the real property tax rate from $100 to $300 annually for nonprofits that own real estate in Honolulu. Nonprofits we asked about this bill said the nominal fee increase is preferable to a repeal of the nonprofit tax exemption.

HANO testified at hearings on the bill, acknowledging that the city needs to cover its administrative costs but expressing concern that the fee increase is an erosion of nonprofit tax-exempt status.

We'll keep providing updates on these and other policy developments affecting nonprofits.  If you're not a member, please consider supporting HANO's efforts and join the ranks of nonprofits statewide that strengthen our sector’s voice through membership. And please enjoy this month's newsletter.

Mahalo,

Lisa Maruyama
HANO President & CEO

www.simplicityHR.com/13344

News for Nonprofits

The Economy

Advocacy & Public Policy

Announcements